Thursday, January 11, 2018

Insanity

Robert Lighthizer, trade ignoramus or tool of crony protectionists?

By Don Boudreaux

With apologies to Frank Knight and the many other economists who through the years have offered similar remarks, I can’t help but remark here that a visitor to earth from another planet would, upon observing the trade policies of nearly every earthly government, conclude that each human being is enriched by producing as many as possible goods and services for others and by receiving as few as possible goods and services in return.

Here’s the blurb of a report today, from World Trade Online, on U.S. Trade Representative Robert Lighthizer’s reaction to the Canadian government’s challenge, at the WTO, of some U.S. “trade remedy” practices:

If Canada succeeds in a new World Trade Organization challenge of six U.S. trade remedy practices, it will harm itself — reducing U.S. trust in Canada as a trading partner — and help China by undermining U.S. rules designed to prevent Chinese products from surging into the U.S., U.S. Trade Representative Robert Lighthizer said in response to Canada’s request for consultations at the WTO.

Note especially this line: “U.S. rules designed to prevent Chinese products from surging into the U.S.” How insanely ridiculous this ‘logic’ is.

The ‘logic’ of protectionism leads to the absurd conclusion that greater access to goods and services is a fate from which people should be protected. This ‘logic’ is illogic; I’ll from here on in call it “ill-logic.”

It’s no exaggeration to say that among the chief actual functions of the state is the resolute creation of artificial scarcity. In practice, states work assiduously to diminish their citizens’ prosperity.